Cal Biz Lit

Boomer Verdicts for July

   

Riverside County:  Jury tags K-Mart in an age discrimination case for $916,000 compensatory damages on Tuesday and $25 million in punitives on Wednesday -- more than twice what the plaintiff attorneys asked for.  Media coverage here and here.  Sears (owner of K-Mart) considering post-trial motions.  Ya think there might be a State Farm v. Campbell argument?

   

Los Angeles County:  Five plaintiffs get defamation verdict totaling $370 million against founder of Guess Jeans.  Each plaintiff gets $69 million in compensatories and $5 mil in punitives.  Story here and here.

   

San Diego County:  $1.3 million elder neglect verdict (total of punitives and compensatories).

    San Francisco County:  Mesothelioma asbestos verdict for $3.4 million.

A Mediator's Perspective on Medicare Recovery and Settlements

    Although this subject doesn't strictly relate to California law (which is generally the field on which CalBizLit plays), CBL has been following developments relating to Medicare's recent, potentially more aggressive approach to recovering payments as well as the reporting requirements being phased in under MMSEA.  For those who haven't followed this, our white paper on the subject is available here and I linked to a good DRI article on the subject here.  

    I was at a mediation yesterday before retired Judge Richard L. Gilbert in Sacramento.  At the front desk of his office were copies of a paper with his perspective on the Medicare recovery issue, particularly the use of Medicare Set Asides and the importance of the parties being prepared on this issue before they begin settlement discussions.  His paper is available at his web site here, and a pdf version is available here.  Highly recommended. 

Prop 65 DART Committee: No Listing of Bisphenol A (At Least For Now)

    CalBizLit has just returned from ten days' vacation, and is more than a little bit behind on just about everything, including blog posts. However, we left one shoe waiting to drop just before departing:  whether or not Bisphenol A, a chemical commonly used to harden plastic, would be listed as a reproductive / developmental toxicant under Proposition 65.  Such a listing would probably result in a gradual end to the use of this ubiquitous chemical in California, since the market for food containers labeled as reproductive toxins is a rather limited one.

    As CBL reported here, the Proposition 65 DART Committee had a meeting scheduled to address this subject on July 15.  With the prescience that marks this blog, CBL predicted that the Committee would list the chemical. 

    Well, wrong.  As reported here by OEHHA, "based upon current scientific information, bisphenol A has not been clearly shown to cause reproductive toxicity; and therefore the Committee declined to add it to the Proposition 65 chemical list."  But in a classic case of it ain't being over 'til it's over, the committee:

requested that OEHHA further evaluate the following concerning bisphenol A for discussion at future meetings of the Committee:

• Possible increased susceptibility for developmental toxicity from bisphenol A in subpopulations, for example in those with poor nutritional status for certain nutrients such as folic acid

• Evidence that bisphenol A exposures in utero or pre-conception may lead to precancerous lesions and eventually cancers (e.g., breast and prostate)

• Evidence for bisphenol A-induced developmental- or reproductive-related neurobehavioral effects, as these endpoints are further studied

•  Evidence for effects on the immune system resulting from bisphenol A exposures during early development, as new information becomes available

• Evidence of bisphenol A-induced developmental and reproductive effects from epidemiologic studies as new information becomes available.

    Given the infrequency of committee meetings and the rate at which the committee adds chemicals to the list, don't look for action on this any time soon.  OEHHA's summary of the meeting and the documents and presentations considered are here.  For those who have trouble sleeping at night, OEHHA promises an MP3 of the entire hearing coming soon.

Court of Appeal Expands Assumption of Risk Defense in Burning Man Case

    It seems hard to believe, but until not all that long ago (1975, to be exact), contributory negligence was a complete defense in California tort cases.  There were some wildly successful defense lawyers who would try and win just a ton of product liability and other personal injury cases by arguing that, sure there client was at fault, but because the plaintiff was just a little, tiny bit at fault too, game over.

    Then the California Supremes adopted pure comparative negligence in Li v. Yellow Cab (1975) 13 Cal.3d 804, and the world changed forever.  Well, at least the tort world did.  California juries now apportion fault between plaintiff and defendants  in all kinds of tort cases, and contributory negligence isn't a bar to anything.

    But there's one remnant of the old system:  the doctrine of primary assumption of risk, which the Cal Supremes recognized in Knight v. Jewett (1992) 3 Cal.4th 296. In that case, the plaintiff was injured playing touch football and was stupid enough to sue the other players for his injuries.  The Cal Supremes eliminated nearly all liability for sports injury cases, ruling that:

a participant in an active sport breaches a legal duty of care to other participants-i.e., engages in conduct that properly may subject him or her to financial liability-only if the participant intentionally injures another player or engages in conduct that is so reckless as to be totally outside the range of the ordinary activity involved in the sport.

Id. at p. 320.

    Now comes the First District Court of Appeals in Beninati v. Black Rock City, LLC (June 30, 2009) ___ Cal.App.4th ___ (No. A12153).  The plaintiff was injured at the Burning Man festival in Nevada when -- I'm not making this up -- he got too close to the burning man.  He sued the Burning Man operators.  Pretty stupid case.  But not a sports injury. 

    That's ok.  The Court held that the case was completely barred by the primary assumption of the risk doctrine, and that the doctrine applied not just to sports, but to any activity "involving an inherent risk of injury to voluntary participants like Beninati, where the risk cannot be eliminated without altering the fundamental nature of the activity."

    How broad did they just make the defense?  I'm guessing pretty broad.  And I'm guessing we'll find out in the years to come, at least if the Supremes don't touch this case.

Proposition 65 DART Committee To Consider Bisphenol A

    CalBizLit has mentioned here and here that there is currently a significant up-tick in the increase of chemicals listed either as carcinogens or reproductive toxicants under Proposition 65.  However, there's a big one coming up at the meeting of the Developmental and Reproductive Toxicant ("DART") Identification Committee this coming Wednesday, July 15 in Oakland.  The sole chemical up for consideration will be Bisphenol A, an industrial chemical used to make plastic resins.  Bishphenol A is very common in all kinds of plastic containers, including baby bottles. 

    Industry and environmentalists have been at each others' throats over Bisphenol A for quite some time.  You can get a small flavor of the battle here at Bisphenol-a.org (pretty clearly an industry-supported site, although I couldn't find anybody taking credit for it), the National Institutes for Health's National Institute of Environmental Health Sciences site on the subject here, and, on the slightly more up-in-arms side, the green perspective at Bisphenolafree.org and the calmly, thoughtfully named "OurStolenFuture.org" here. 

   

OEHHA's write-up on Bisphenol A, downloadable here, is a thumping 300 pages or so long.  CalBizLit read it (ok, scanned it), so you don't have to.  Bottom line:  this really shapes up as a classic precautionary principle vs. burden of proof kind of battle.  OEHHA seems to ackknowledge that the epidemiology is pretty inconclusive, and that

[s]tudies reporting adverse reproductive effects of BPA and studies reporting no such effects are both numerous. Overall, studies that used sensitive methodologies to assess appropriate endpoints consistently reported developmental, female-reproductive and male-reproductive effects. 

    I think there are a number of toxicologists who would take issue with that final statement.  Of course, just about all of the evidence is animal or in vitro evidence, and OEHHA also acknowledges that much of the science hasn't been replicated.  Furthermore, the endpoints seem to be a smattering of possible male and female reproductive effects, many of which have been seen in rodents.

    My guess is DART votes to list Bisphenol A.  The impact will be huge, and probably nationwide:  There's just not much of a market for plastic baby bottles that come with a warning about reproductive or developmental harm, so many Bisphenol A containers will likely disappear.  That is, after a few years of bounty hunter enforcement litigation.

Trial Court Strikes Blow For Common Sense In Anti-"Ladies Day" Case

    CalBizLit previously blogged here and here about that brave crusading lawyer and sometime litigant Alfred Rava's efforts to eliminate the scourge of business discrimination against fathers, who sustain humiliation and other forms of emotional distress when they are deprived of stupid hats and other ballpark giveaways on Mother's Day.  Now comes word of his efforts to assert a class action of the same type against Bear Valley Ski Resort.

    Didn't work out so well.  L.A. Superior Court Anthony Mohr denied Rava's motion to certify a class of 995 helpless victims of Ladies Day discrimination. Judge Mohr noted that because the Unruh Act, under which Rava proceeded, provides for minimum penalties of $4,000, there was no need for a class action. 

Assuming plaintiff succeeds on the merits, Bear Valley Ski Resort would be liable for mandatory statutory penalties of $4,000 X 995 putative class members.  The product of $3,980,000 constitutes a draconian sum that would strip Bear Valley of its assets.

You can read Judge Mohr's ruling here.  Some thoughtful commentary on Mr. Rava appears here.

    Hat tip to Legal Pad.  And when selecting the graphic to run with this post, I really wanted to use the brochure with the  "ski bear" homonym, but this is a family blog and I just couldn't do it.

What Does It Take To Allege A Cause of Action In California State Court?

    About six weeks ago, the US Supremes issued their pleading decision in Ashcroft v. Iqbal, ___ U.S. ___ (May 18, 2009, No. 07-1015).  The  Wall Street Journal quotes those ubiquitous "legal experts" as saying Iqbal may be the most important case of the term.  While Iqbal was a discrimination case, SCOTUS seems to impose requirements for pleading any cause of action much more stringent than many practioners may have assumed under FRCP, Rule 8's "short and plain statement of the claim" standard.

    Well, this blog isn't about federal practice;  it's about California practice.  And what is the standard for pleading a cause of action in the Golden State?  According to Code of Civil Procedure section 425.10(a)(1), a complaint must contain "a statement of the facts constituting the cause of action, in ordinary and concise language."  So what does that mean?  It means the plaintiff must allege "ultimate facts," not "conclusions of law."  Huh? 

    There are an awful lot of defense lawyers around these parts who cut their teeth in their formative years drafting demurrers (California's version of a FRCP Rule 12(b)(6) motion) addressing just whether or not complaints met this standard, and there are tons of appellate cases on the subject.  But the fact is, in a typical product liability or other personal injury tort case these attacks on the pleadings rarely achieve anything very useful and, fortunately, they seem to be less common than they used to be. 

    Anyway, some years ago, California's Judicial Council began adopting check box forms to be used as pleadings.  Besides taking away some of the more stylish flourishes that used to appear in pleadings in the olden days (". . . plaintiff alleges that she was injured in her health and her strength and in her ability to do her work, all resulting in damages in an amount presently unknown, but plaintiff will seek leave of this honorable court to amend this Complaint when the amount becomes known. . ."  etc., ad nauseum) these forms, while not mandatory,  have resulted in what we at CalBizLit sometimes call "no-notice pleading." 

    Here's what the Judicial Council considers to be an adequate allegation of a product liability cause of action.  Do you think filling out this form would get the plaintiff past Iqbal?  I'm thinking not so much.

    So that's reason 1,546 why defendants like Federal Court.

New Article on MMSEA / MSP Compliance

    The focus of this blog is usually California legal matters.   However, because the issue seems so important to everyone in the product liability defense world (and the tort world in general), CalBizLit put up a post and a a white paper on what we called the perfect storm caused by three events:  the 2003 amendments to the Medicare Act reinforcing Medicare's right to recover benefits from  tort settlements;   the Center for Medicare and Medicaid's (CMS)  retention of a new recovery contractor;  and Congress's enactment of the Medicare, Medicaid and SCHIP Extension Act of 2007 (MMSEA). 

    The upshot of all this was (a)  that product liability defendants faced double or even triple payment of Medicare's liens if they didn't make sure CMS was taken at the time of any settlement;  and (b)  defendants and insurers were being deputized to electronically report actions by Medicare recipients so the agency could make sure its rights were protected.  There's much more to it than this, and any company involved in personal injury litigation needs to get itself educated on MMSEA, and soon.

    Last month's issue of For The Defense, The Defense Research Institute's monthly mag, has a good article by Dorothy E. Kelly and Robert T. Lewis of Crowe Paradis, called The Next Chapter in Medicare Compliance.  DRI doesn't have its June issue up on line yet, but Crowe Paradis (which appears to have established a business to help companies with MMSEA compliance) has posted the article here.  Worth a look.

California: We May Be Broke, But We've Joined the Twenty-First Century

    As I posted here two and one half years ago, despite California's status as the home of Silicon Valley, the birthplace of Google, Amazon.com, Intel, Yahoo, Hewlett Packard, Oracle, McAfee, Intuit, Symantic and scores of other companies that used silicon and ones and zeroes to change the way we work, play, practice law, etc., California has had no statutes, no rules, and scarcely any case law addressing issues of electronic discovery.

    Late last year (as discussed here), the legislature finally passed an e-discovery act.  But at the time, the Governator and the legislature were at each others throats over the then projected $28 billion state budget deficit, Ahnuld was vetoing every non-budget bill that crossed his desk, and what was then AB 926 landed on the scrap heap.

    Well, as luck would have it, California now has a budget gap of more than $26 billion for one year, the treasury is paying its bills (and tax refunds) with IOUs, and the current donnybrook  between legislature and governor makes last December's squabble look trivial by comparison.  But while the governor is still talking about vetoing all non-budget related legislation, he did manage to take a moment away from the budget smack-down to sign AB 5, which is essentially the same as the act he vetoed last year.  The new act adds Code of Civil Procedure section 1985.8 specifically dealing with subpoenas of electronically stored data, adds a variety of related provisions throughout the Discovery Act, and addresses issues of reasonable accessibility and the format(s) in which electronically stored data shall be produced.  The entire act, which takes effect immediately,  is here.